San Francisco is launching an experiment to give families free money

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A basic income experiment is coming to San Francisco, California.

Announced at a January 23 forum hosted by the city's Office of Financial Empowerment (OFE), a subsection of the Office of the Treasurer, the experiment will reportedly be a pilot program focused on families and children, Hoodline first reported.

Basic income is a wealth-distribution system that involves giving every citizen a fixed amount of money each month to cover basic living expenses. Advocate argue that by strengthening the social safety net, fewer people will be able to slip into poverty, ultimately creating healthier and happier societies.

Some early evidence in the developing world shows the model really does help people get more education and make crucial repairs to their homes. One question skeptics often pose, however, is to what extent recipients waste the money on vices like drugs and alcohol.

That's where the focus of the San Francisco pilot sets it apart from other experiments in the general population, says Sean Kline, director of the OFE. The pilot only includes families with children.

"A focus on kids skirts a lot of the questions people usually have about basic income," Kline said at the forum. Specifically, the trial will compare how kids in families getting basic income fare compared to kids in families receiving other social services.

There will be four groups overall: families with 1-year-olds, families with 3-year-olds, families receiving other forms of assistance (such as nursing care), and families receiving nothing. So far, OFE has planned for a $5 million budget in San Francisco. Families will receive between $1,000 and $2,000 a month.

If it can secure additional funding through grant programs, it will also look to conduct similar trials in Detroit, Michigan and New Haven, Connecticut. No launch date has been announced.

Once it begins, the experiment will join the nearby pilot going in Oakland, run by the startup incubator Y Combinator. YC's basic income trial involves 100 families also receiving a monthly payment between $1,000 and $2,000. The families all come from different socioeconomic backgrounds.

The support for basic income in San Francisco hasn't been unanimous, Kline said, mainly because it's such a radical overhaul of the current system. In City Hall, he added, some have called the approach "a Trojan horse that takes down all existing social safety nets either in one fell swoop, or by a thousand paper cuts."

Jim Pugh, co-founder of the San Francisco-based Universal Income Project, a basic income advocacy group, says the experiment helps a growing movement build even more momentum on the way to becoming actual policy.

"There's been a significant uptick in people exploring basic income in a city and state level," as opposed to pushing national studies, Pugh tells Business Insider. "People are realizing there are pretty big steps that can be made by going into more specific geographical areas."